Week -1 Assignment Operation Excellence- ITS 631

                                                            Week -1

                                                            Assignment

Operation Excellence- ITS 631

Submitted By: Bipin Lamichhane

Student ID: 2841983

Definition and Company Overview

Definition

Duggan (2012) defined Operation excellence “When each and every employee can see the flow of value to the customer, and fix that flow before it breaks down.”

APICS The Association for operations management also defines operation management as the field of study that focuses on the effectively planning, scheduling, use and control of a manufacturing or service organization through the study of concepts from design engineering, industrial engineering, management information system, quality management, inventory management and other functions as they affect the organization.

 In a simple way, in a company each employee has good knowledge about the product moves from the process A to process B in a specific quantity at specific time, to a specific location; if not something is wrong. It is vital for any companies whether they are small or big whether they are private, public or non- profit organization, drive operational excellence into their operations. Especially at this time where technology has played vital role in everyone’s life and customers are more aware about the products and services they are buying.  Operational excellence nowadays played important role not just in shaping the structure of company but also the future of company.

Company Overview

Bata India is one of the largest retailer and manufacturer in Southeast Asia and is part of Bata Shoe organization. It was incorporated as Bata Shoe company Private Ltd in 1931 and was first manufacturing facility in Indian shoe industry to receive the ISO:9001 certifications. The company went public in 1973 and changed its name Bata India Ltd. Today Bata India has established itself as largest foot wear retailer in India and its neighboring countries like Nepal, Bangladesh, China and Sri Lanka. There are 5 production plants, 1500 retail stores and 27 wholesale depots spread in different location in India. Bata India sells around 60 million pairs every year and have given employee to more than 15000 people. But it was not easy to achieve this success without constant improvements in its operation over the period of time.

Situation/ Problem

Bata India has faced continuous challenge from internal or external environment throughout the period. In this case we are going to discuss the current issues and problems faced by top management and we will try to recommend the solutions to those problems with the help of operation management and operation excellence techniques and tools. Things always won’t go as planned, there will be many obstacles and issues that company faces in daily manner. Successful tackles of these issues not only determine the success of business but also helps to understand the abilities of employee and management team.

Problems mentioned by management team:

1)      High cost structure and surplus labor

2)      Low productivity in some plants

3)      Inefficient and unskilled manpower

High cost structure and surplus labor: The cost of operations in many Bata plants are in increasing trend where the production level remains the same. High cost structure will affect the price of end products which will definitely affects the sales revenue of company. The main reason for this problems is poor management of resources and inefficient distribution of labor.

Low productivity:  The main problems Bata India shoe factory now faced is low productivity. This resulted in late deliveries. The demand of Bata shoes is 40000 pair every day but due to low productivity the company only manages to manufacture 33000 pairs. Productivity is affected by the factors such as use of outdated technology, poor management and poor quality of raw materials.

Manpower: Due to inefficient and unskilled manpower Bata India is now facing serious production and operation problems. Lack of training in works and poor human resource management contributes in inefficient and unskilled manpower. Unskilled manpower will increase the operating cost, increase the product failure and errors in production which will affect the quality of products.

Recommendation I

On the above mentioned issues we will try to solve those issues on the basis of operations management. Here we will discuss the issues in depth and relates to the operations management and its principles to solve the problems.

High cost structure and surplus labor: High cost structure is basically resulted from increase in production time and disruption of work from various factors. For this issue, in every new upcoming project, all the team members and project manager are clearly briefed about their task and responsibility. Each and every production batch are provided with certain standard time to finish the batch and each batch time is regularly monitored by managers.  Every employee should be given a good knowledge about transformation process which includes input resources, transformed resources, transforming resources, transformation process and finally output product and services.

Low productivity: Productivity is directly related to the operations of company. How a company operates its day to day activity and how operation is handled by general employee to the top level of hierarchy determines productivity of the company. Production can be increased with the constant improvement in end to end business processes. Business processes such as increase in production time, flexibility in production unit, routine follow up of the employee activity, constant improvement of technology. Production can also be increased with the efficient supply network flow between operations.

Inefficient and unskilled manpower: Skilled manpower are the pillars of organization. They can turn the deficit into profit in the matter of time. Most of the Bata India employee lacks proper training about the operation management and system of the company. The knowledge and experience of human resource management team should be frequently observed and updated so the new employee in the company are hired on the basis of their experience and expertise about the system and operation of company.

Recommendation II

On this section we will solve the issues of Bata India on the basis of operations performance. Operations performance is the alignment of all business units within an organization to ensure that they are working together to achieve core business goals. In relating to current issues of Bata India the operation performance of company needs to be more enhanced and needed to be increased in certain standards. Here we will try to give some recommendation to the issues we talked above in our case.

 High cost structure and surplus labor:  There are three level of operations performance, operational level, strategic level and societal level.  Operational level performance focuses on quality, speed, flexibility and cost of operations. All the projects need to be flexible so if something doesn’t go along with plan the projects does not have to be start from the beginning. Speed in the project focuses on finishing all the necessary task in given period of time. Time is always important factors in the project so all the necessary task should be well planned and executed in order to achieve goals and objectives of a project. Another important factor to reduce the cost of structure is dependability of project. Dependability of project reflects the on time delivery of all the necessary variables in the project. Dependability of project prevents lateness causing disruption and wasted time and effort.

Low productivity: Low productivity is often the results from inefficient operations in various department of organization. To tackle this issues Bata India should assess their operation and should make adequate decision in their operation management. They should focus on reliable operations, error free process, fast through put. Bata India must prevent errors causing internal unreliability and low dependability, prevents error causing wasted time and effort, therefore saving cost and increase in productivity.

Inefficient and unskilled manpower: Skilled manpower in different areas of operation ease the process of operations and yields to success of the project. Bata India should focus on employing skilled people and encourage them to contribute ideas for cutting out waste and working more effectively. They should hold regular meetings where staff share their experiences and think about how they can build their knowledge of customer needs, new technologies and how they can add value for their customers.

References

Johnson, Jamie. (1028, May 7). “Core Principle of Operational Excellence [10 core principles].”  Retrieved  from https://tallyfy.com/guides/operational-excellence 

Essays, UK. (November 2013). The operations of shoe manufacturer Bata. Retrieved from https://www.ukessays.com/essays/management/the-operations-of-shoe-manufacturer-bata-management-essay.php?vref=1

Stevenson, W. and Sum, C. (2007). Operations management. 9^th ed.[Singapore]: McGraw-Hill Education (Asia).

Slack, N., Brandon-Jones, A. and Johnson, R. (2016). Operations management 8^th ed. Harlow, UK: Pearson Educational Limited.

Brown, S., Lamming, R., Bessant, J. and Jones, P. (2000). Strategic operations management. Oxford [u.a]: Butterworth- Heinemann.